DI: Accurate Statistics Is The Base For Planning

The Danquah Institute welcomes the debate that has been generated by the “State of our Economy” lecture delivered by the 2012 vice Presidential Candidate of the New Patriotic Party (NPP), Dr Mahamudu Bawumia.

Our disappointment, however, is over an attempt to have the debate hijacked by the culture of personal attacks and a diversionary shadow boxing between the Ghana Statistical Service and the main opposition party, the NPP.

Several issues of vital national interest were raised by the former Deputy Governor of the Bank of Ghana in his speech. These included, unemployment, rising cost of living, inflated cost of contracts, unprecedented appetite for borrowing, the doubling of the country's external debt in such record time and the seeming disconnect between what government claims to be its major achievements and the realities on the ground as experienced by Ghanaians.

We believe these are legitimate concerns that should, hopefully, agitate the minds of Ghanaians, while scrutinising the alternative proposals as and when they are provided by the competing political parties.

However, we wish to use this press statement to focus on one issue that has generated a lot of controversy, eliciting responses from the Ghana Statistical Service (GSS), Ministry of Finance, government communicators, civil society groups and others.

With this we mean the call made by Dr Bawumia for the GSS to be well-resourced, as well as granted greater autonomy.

This call by Dr Bawumia has been described as an “attack” on the GSS and the Danquah Institute is deeply disappointed by this defeatist, defensive response from government, in general, and the GSS, in particular.

Dr Bawumia’s statement regarding the GSS, in our view, sought fundamentally to draw attention to the under-resourcing and the ambiguity surrounding the autonomy of the Statistical Service.

Linked to the above is the worrying dependence of the Statistical Service on donor funding. Indeed, Dr Bawumia was not the first to raise these matters on the national stage in recent times. Both the former Minister of Manpower (in 2010), Hon. E T Mensah, and the Chairman of the GSS Board, Professor Francis Dodoo, have highlighted the institutional weaknesses affecting the output of the GSS.

It is important that we, as a nation, address the problems, both historic and current, facing the GSS, devoid of the usual retaliatory partisan politics. This is not an NPP vrs NDC issue. Giving the GSS the independence and resources it needs to take decisions professionally without political influence, and efficiently without cutting corners or delays, are matters that ought to be addressed head-on.

The Ghana Statistical Service, established by Act 135 of 1985, is the primary government agency responsible for the production and dissemination of statistics on all aspects of the economy of Ghana. Significantly, the Act mandates the Service to report directly to the Ministry of Finance and Economic Planning. Thus, even before statistics of national interest are made public, it is sent to the Minister of Finance for prior notice, if not approval.

The granting of independence for such a key state institution cannot be over-emphasised. We, at the Danquah Institute, therefore, welcome the proposal from the NPP to guarantee the professional independence of the GSS, and we look forward to scrutinizing this whenever the party comes forth with the details of this manifesto proposal.

It is recalled that the International Monetary Fund held in 2001 that in 2000 the Bank of Ghana “deliberately misreported” data to the IMF. For this, the country was fined $38 million. The independence granted the Bank of Ghana in 2002 certainly helped in succeeding years to shield the central bank from the kind of undue political pressures that might have led to the wrong reporting of data 12 years ago.

We fully back the proposal to enhance the autonomy of the GSS and we would urge the leadership and staff of the institution to take this call in good faith.

There are numerous examples worldwide of the importance of decoupling a country’s department of statistics from government interference. The United Kingdom’s Statistics Authority, for example, is an independent body operating at arm's length from Government as a non-ministerial department, directly accountable to Parliament. It was established on 1 April 2008 by the Statistics and Registration Service Act 2007.

The Federal Statistical Office of Germany is a federal authority of Germany responsible for collecting, processing, presenting and analysing statistical information concerning the topics economy, society and environment. The purpose for setting up this office was to provide objective, independent and highly qualitative statistical information for the German public and government.

In dismissing the former Head of the Ghana Statistical Service, Dr Grace Bediako, the Board Chairman of the Ghana Statistical Service, Professor Dodoo, said, based on the “evidence of performance” and “poor delivery” of the Ghana Statistics Development Plan, the Ghana Statistical Service would lose an amount of $40 million. Instructively, the Board sacked Dr Grace Bediako because they were afraid of losing institution-saving money from donors.

We think it is a startling indictment on our sovereign nation that the funding of this all-important state institution be left precariously to the unpredictability of donor funding? Donor funding, though welcome, must play a complimentary role rather than the controlling, destiny-determining kind.

The difficulties that have been experienced by the Ghana Statistical Service may not be limited to the last two years alone. On the 26th of July 2010, the then Minister of Employment and Social Welfare, Mr E.T Mensah, in a statement to Parliament, bemoaned the lack of timely statistics regarding the labour force in the country.

In proffering a solution to this problem, Mr E.T Mensah said: “It is therefore important that the House and indeed the entire nation realises that the best way to get regular labour market statistics for planning is to strengthen the institutions responsible for data collection and analysis with adequate financial and human resources.” The Danquah Institute, in light of these developments, supports the call made by the New Patriotic Party in calling for a well-resourced and independent Ghana Statistical Service.

In 2010, the Ghana Statistical Service realised that Ghana’s economy had been underestimated by 60%. The rebasing of Ghana’s economy was, by itself, an institutional admission that there were errors present in the data that was being computed by the GSS in measuring the size of the Ghanaian economy.

The cost of this error included policy decisions being taken based on wrong information, with dire consequences for the real economy. We witnessed the policy decisions that were taken in 2009 as a result of the fiscal deficit being wrongly estimated to be twice as big.

It is important that policies are informed by accurate data. Accurate statistics form the bases for planning, be it for the government, the private sector or the individual. Flawed statistics influence decision-making -- including vital ones involving expenditure and investment --leading to undesirable outcomes. Therefore, it is supremely important to ensure the accuracy and reliability of statistics.

DI's own tracking of some 45% of the goods and services making up the basket for the Consumer Price Index makes interesting reading as it appears to be at variance with the inflation figures presented by the GSS over the last couple of years.

We cannot, as a nation, afford to be basing policy decisions of the availability of statistics which are not credible or cannot be trusted. It is imperative therefore that the Statistical Service, in particular, be resourced adequately and given the much needed independence it requires.